The scheme covers certified products grown by smallholder farmers, and the LIRP on-demand offering is an extension of Fairtrade’s data-driven, globally recognised model for developing living income reference prices.
This is the price a typical farmer household with a viable farm size and a sustainable productivity level needs to receive to achieve a living income from crop sales.
The ‘LIRP on demand’ can be completed in three to six months. The service offer includes four-year annual inflation updates to ensure the prices' validity.
“We believe that businesses must play a part in achieving sustainable livelihoods for farmers, and we see momentum in the market from leading retailers and brands,” said Carla Veldhuyzen van Zanten, senior advisor of Sustainable Livelihoods at Fairtrade International.
Anthony Myers
Fairtrade established its first Living Income Reference Price for cocoa in 2019. Its updated approach includes a pre-assessment process, where Fairtrade identifies the product and origin specifications for which reference prices should be generated. Fairtrade then analyses the data to estimate key parameters of the pricing model and a first approximation of what a LIRP could look like.
So far, this approach has been optimized through 27 case studies in 19 countries.
- Fairtrade International will explain more details of the LIRP on-demand process in an upcoming webinar about how the new LIRP resources can work for companies. Register here.
Anthony Myers